The global laser systems and components industry has achieved significant growth amid the COVID-19 pandemic. According to market research firm Optech Consulting, the global market for industrial laser systems registered 22% growth in 2021. This momentum is expected to continue despite current logistical and production hurdles owing to soaring demand from several industries.
With the advent of Industry 4.0, advancements in industrial automation, robotics, and 3D printing should drive the demand for laser systems in many industries. And the industrial laser system market is projected to grow at a 7.26% CAGR from 2022 to 2031.
So, we think it could be wise to scoop up fundamentally sound laser systems and components stocks MKS Instruments, Inc. (MKSI) and CyberOptics Corporation (CYBE).
MKS Instruments, Inc. (MKSI)
MKSI in Andover, Mass., provides instruments, systems, subsystems, and process control solutions that measure, monitor, deliver, analyze, power, and control critical parameters of manufacturing processes worldwide. Its segments are Vacuum & Analysis; Light & Motion; and Equipment & Solutions.
On Jan. 26, 2022, President and CEO John T.C. Lee said, “We are excited for what 2022 holds for MKS with expected continued industry tailwinds and our pending acquisition of Atotech Limited. The addition of Atotech will advance our strategy of delivering foundational technology solutions in the era of accelerating miniaturization and complexity.”
MKSI’s total net revenues increased 15.7% year-over-year to $763.90 million for the fourth quarter ended Dec. 31, 2021. Its net income came in at $150.20 million, up 29.9% year-over-year, while its EPS came in at $2.69, up 29.3% year-over-year.
Analysts expect MKSI’s revenue to increase 4.7% year-over-year to $3.31 billion in 2023. Its EPS is estimated to increase 12% per annum for the next five years. In addition, it has surpassed the consensus EPS estimates in each of the trailing four quarters. Over the past month, the stock has gained 3.9% in price to close yesterday’s trading session at $156.46.
MKSI’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall B rating, which indicates a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 distinct factors, each with its own weighting.
MKSI has a B grade for Value, Momentum, and Quality. It is ranked #23 of 90 stocks in the Industrial - Equipment industry. Click here to see the additional POWR Ratings for Growth, Stability, and Sentiment for MKSI.
Note that MKSI is one of the few stocks handpicked currently in the Reitmeister Total Return portfolio. Learn more here.
Click here to check out our Industrial Sector Report for 2022
CyberOptics Corporation (CYBE)
CYBE designs, develops, manufactures, and markets high precision sensing technology solutions and system products for inspection and metrology worldwide. It is a leading global developer and manufacturer of high-precision 3D sensing technology solutions. CYBE is headquartered in Minneapolis, Minn.
On Feb. 17, 2022, Dr. Subodh Kulkarni, president and CEO, said, “The competitive advantages of our advanced sensor and inspection and metrology system products are enabling us to capitalize upon strong growth opportunities in these markets. Demand for our MRS-based products and WaferSense sensors is expected to remain strong for some time, making us optimistic about CyberOptics’ outlook for the first quarter of 2022.”
CYBE’s revenue came in at $22.08 million for the fourth quarter, ended Dec. 31, 2021, up 30.8% year-over-year. Its net income came in at $3.40 million, up 132.1% year-over-year, while its EPS came in at $0.45, up 125% year-over-year.
For its fiscal year 2022, analysts expect CYBE’s revenue to be $102.60 million, representing a 10.6% year-over-year rise. The company’s EPS is expected to increase 25% per annum for the next five years. It surpassed the EPS estimates in each of the four trailing quarters. Over the past year, the stock has gained 72.9% in price to close yesterday’s trading session at $43.31.
CYBE’s POWR Ratings reflect this promising outlook. The stock has an overall B rating, which equates to a Buy in our POWR Rating system. Also, the stock has an A grade for Sentiment and a B grade for Growth and Momentum.
Click here to see CYBE’s Value, Stability, and Quality ratings. CYBE is ranked #8 of 45 stocks in the Technology - Hardware industry.
MKSI shares were trading at $156.20 per share on Thursday morning, down $0.26 (-0.17%). Year-to-date, MKSI has declined -10.18%, versus a -3.31% rise in the benchmark S&P 500 index during the same period.
About the Author: Riddhima Chakraborty
Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries.
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